4 Consumer Products Discretionary Stocks Investors Must Buy in H2 2026

The Consumer Products-Discretionary industry is navigating a mixed operating environment, with resilient consumer demand tempered by persistent macroeconomic uncertainty. Inflationary pressures have eased from their recent peaks, and consumer confidence has shown signs of stabilization. Still, households remain selective in their spending as elevated living costs, an uneven labor market and lingering interest-rate pressures continue to influence purchasing decisions. While higher-income consumers have largely remained resilient, lower and middle-income households are prioritizing value, leading to a bifurcated spending environment across discretionary categories.

Against this backdrop, companies are relying less on broad-based demand and more on execution to drive growth. Investments in omnichannel capabilities, AI-powered personalization, retail media, loyalty programs and supply-chain efficiencies are taking precedence. At the same time, companies continue to contend with promotional competition, tariffs and cautious inventory management, making pricing discipline and operational efficiency critical to protecting margins. As consumers gravitate toward brands that offer compelling value and convenience, industry players with strong digital ecosystems, diversified sourcing strategies and disciplined cost structures remain better positioned to outperform the broader consumer discretionary industry.

Central Garden & Pet Company CENT, Alto Ingredients, Inc. ALTO, Lifetime Brands, Inc. LCUT and ACCO Brands Corporation ACCO stand out as strong contenders in this evolving marketplace.

About the Industry

The Consumer Products-Discretionary industry has a direct correlation with the economy, making it cyclical. Discretionary products command high prices, with middle-to-higher-income groups being the targeted customers. The industry comprises companies that offer product categories, including fashion, jewelry and watches, and other home and art products. Quite a few players develop, manufacture, market and sell over-the-counter health and personal care products. Some even manufacture and distribute party goods. Some companies design, source and distribute licensed pop culture products, too. Some industry participants also produce and distribute various products for the lawn and garden and pet supplies markets. Companies sell products to specialty retailers, mass-market retailers and e-commerce sites.

4 Key Trends to Watch in the Industry

Consumers Remain Selective as Value Becomes the Primary Driver: Consumer spending remains resilient but selective as households continue to balance discretionary purchases against higher living costs, elevated borrowing expenses and lingering economic uncertainty. While easing inflation has provided some relief, shoppers remain value-conscious and are prioritizing essential and experience-led purchases. Promotional activity remains elevated across many retail categories, compelling companies to compete through sharper pricing, exclusive assortments and loyalty programs. Companies that successfully combine compelling value with differentiated merchandise and strong brand positioning are expected to be better placed to sustain demand.

Digital Innovation and AI Continue to Reshape Industry: Industry participants are accelerating investments in digital capabilities to improve customer engagement, operational efficiency and profitability. Artificial intelligence is increasingly being deployed across merchandising, pricing, inventory planning, customer service and personalized marketing, helping companies make faster and more informed decisions. Omnichannel strategies remain central to growth as consumers expect seamless shopping experiences across stores, websites and mobile platforms. Faster fulfillment, enhanced convenience and data-driven personalization are becoming key competitive advantages, allowing leading companies to strengthen customer loyalty while improving productivity and long-term margin potential.

Margin Expansion Depends on Operational Discipline: Although supply-chain disruptions have largely eased, industry players continue to face pressure from labor costs, tariffs, transportation expenses and ongoing technology investments. As a result, margin expansion will depend less on pricing and more on disciplined execution. Companies are focusing on inventory optimization, sourcing diversification, automation and expense control to improve profitability while limiting markdowns. Industry participants that maintain healthy inventory levels, strengthen supply-chain flexibility and preserve pricing discipline are likely to navigate cost pressures more effectively and deliver stronger earnings quality despite a challenging operating environment.

Brand Innovation to Fuel Growth: Consumer preferences continue to shift toward wellness, beauty, athleticwear and experience-driven spending, creating growth opportunities across select discretionary categories. At the same time, shoppers remain selective, with stronger demand concentrated among brands that offer clear value, innovation or premium differentiation. Companies with differentiated product portfolios, compelling merchandising and strong brand equity are expected to capture a larger share of consumer spending. Continued investments in customer experience and international expansion should further support long-term growth.

Zacks Industry Rank Indicates Bright Prospects

The Zacks Consumer Products-Discretionary industry is a group within the broader Consumer Discretionary sector. The industry currently carries a Zacks Industry Rank #91, which places it in the top 37% of more than 250 Zacks industries.

The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates encouraging near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. The industry’s position in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate.

Looking at the aggregate earnings estimate revisions, it appears that analysts are gaining confidence in this group’s earnings growth potential. Since the beginning of 2026, the industry’s earnings estimate has risen 5.3%.

Before we present a few stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.

Industry Versus Broader Market

The Zacks Consumer Products-Discretionary industry has outperformed the broader Zacks Consumer Discretionary sector but underperformed the Zacks S&P 500 composite over the past year.

The industry has advanced 4.5% over this period compared with the S&P 500’s rise of 22.8%. Meanwhile, the broader sector has fallen 16%.

One-Year Price Performance

Industry's Current Valuation

Based on the forward 12-month price-to-sales (P/S), which is commonly used for valuing consumer discretionary stocks, the industry is currently trading at 3.16X compared with the S&P 500’s 5.05X and the sector’s 2.30X.

Over the last five years, the industry has traded as high as 14.10X and as low as 2.35X, with the median being at 3.00X, as the chart below shows.

Price-to-Sales Ratio (Past 5 Years)

4 Stocks to Watch

Central Garden & Pet Company: Central Garden & Pet continues to strengthen its competitive position through a balanced portfolio of leading pet and garden brands, disciplined execution and a growing focus on innovation. The company is streamlining operations, enhancing distribution capabilities and investing in new products, digital initiatives and targeted acquisitions to drive sustainable, profitable growth. Supported by a resilient operating model, healthy customer relationships and a strong balance sheet, CENT remains well-positioned to capitalize on evolving consumer preferences and market opportunities. Its continued emphasis on operational excellence, strategic investments and portfolio optimization should support sustained long-term success.

The Zacks Consensus Estimate for Central Garden & Pet Company’s current financial-year EPS suggests growth of 5.9% from the year-ago period. CENT delivered a trailing four-quarter earnings surprise of 45.4%, on average. Shares of this Zacks Rank #1 (Strong Buy) company have advanced 20.5% over the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.

Price and Consensus: CENT

Alto Ingredients: Alto Ingredients is strengthening its long-term growth profile through a more diversified operating model, a disciplined cost structure and a growing focus on higher-value product streams. The company is investing in optimization projects, production efficiency, logistics infrastructure and carbon reduction initiatives while expanding opportunities tied to renewable fuels, biogenic CO2 and low-carbon incentives. Supported by operational improvements, strong capital discipline and a flexible asset base, Alto is well-positioned to capitalize on favorable industry trends and evolving market demand. Its continued emphasis on innovation, value-added products and strategic execution should reinforce its foundation for sustainable long-term growth.

This leading producer of specialty alcohols, renewable fuels and essential ingredients delivered a trailing four-quarter earnings surprise of 361.5%, on average. The Zacks Consensus Estimate for Alto Ingredients’ current financial-year sales and EPS calls for growth of 8.6% and 671.4%, respectively, from the year-ago period. Shares of this Zacks Rank #1 company have soared 348.4% over the past year.

Price and Consensus: ALTO

Lifetime Brands: Lifetime Brands continues to strengthen its market position through a portfolio of well-known kitchenware and home products brands, supported by disciplined pricing, operational efficiency and a steady pipeline of new product innovation. The company is benefiting from strong momentum in key categories, expanding brand partnerships, improving international operations and strategic investments in its distribution network, positioning it for enhanced profitability and growth. With a more diversified sourcing strategy, disciplined cost management and a healthy pipeline of acquisition opportunities, Lifetime is well equipped to navigate an evolving retail environment. Its continued focus on innovation, execution and operational excellence positions the company for sustained long-term success.

This global designer, developer and marketer of branded kitchenware, tableware and home solutions has a trailing four-quarter earnings surprise of 50%, on average. The Zacks Consensus Estimate for Lifetime Brands’ current financial-year sales suggests growth of 3.6% from the year-ago period. Shares of this Zacks Rank #1 company have rallied 57.7% over the past year.

Price and Consensus: LCUT

ACCO Brands: ACCO Brands is strengthening its long-term growth profile by expanding its presence in faster-growing technology peripherals while leveraging its portfolio of trusted workplace, gaming and computer accessory brands. The company is executing on strategic initiatives, including the integration of EPOS, new product innovation, cost optimization and footprint improvements, to enhance operational efficiency and support profitable growth. Supported by disciplined cost management, a diversified global footprint and a healthy product pipeline, ACCO is well-positioned to capitalize on evolving market opportunities and strengthen its competitive position. Its continued focus on innovation, strategic execution and portfolio transformation should support sustainable long-term growth and shareholder value creation.

The Zacks Consensus Estimate for ACCO Brands’ current financial-year sales and EPS suggests growth of 2.1% and 3.6%, respectively, from the year-ago period. ACCO delivered a trailing four-quarter earnings surprise of 33%, on average. Shares of this Zacks Rank #2 (Buy) company have risen 5.3% over the past year.

Price and Consensus: ACCO

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